Dispute resolution laid bare by top panel
Dispute resolution laid bare by top panel
14 June 2010 | By Catrin Griffiths
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The Lawyer Debate on Dispute Resolution, 8 June 2010: THE LAWYER’s first town hall debate on dispute resolution took place last week (8 June), with a stellar panel and an audience of general counsel and City litigators.
Chairing the debate was Clifford Chance commercial litigation head Simon Davis, who began by asking the panel (see box) how dispute resolution processes could be aligned more closely with the needs of the business community.
The most pointed contribution was from Barclays litigation director Jonathan Peddie, who observed: “If you purport to be a global firm, please act like one. If you see things cropping up in other jurisdictions that might be relevant in this jurisdiction, then tell us. That risk radar is important to me.”
Peddie later elaborated the way the landscape had changed for him and his in-house colleagues. “Nowadays there’s very little banking litigation,” he emphasised. “It’s either civil litigation that turns big so the regulator gets interested, a regulatory issue that spawns consumer interest, or a criminal offence that requires civil or regulatory interest and enforcement. And with that tripartite nightmare comes the possibility of investigation. So if you’re missing those capabilities, then you’re not going to be able to serve the client.”
Chair: Simon Davis,
Out of order?
One of the questions from the floor that generated considerable debate was from Clyde & Co counsel Claire Stockford, who asked whether the panel thought the US idea of a litigation prenup or economical litigation agreement (whereby at the time of contract formation parties agree to limit disclosure in relation to the value of the dispute) could work in the UK. The panel’s view was mostly negative.
Peddie observed: “Trying to pre-empt problems with a cost-based control is one of the single most dangerous things you can do in the pursuit of truth and certainty.”
Navigant managing director of disputes and investigations David Saunders argued that to narrow things from the outset would lead to issues over deliberating quantum.
Freshfields Bruckhaus Deringer arbitration partner Constantine Partasides was less horrified at the thought of a commercial prenup, saying it might, in certain circumstances, be advantageous to take a view on the way a dispute could be determined, for instance if it was discovery-heavy.
Perhaps most intriguing was Mr Justice Ramsey’s view that parties should be free, within reason, to agree the manner in which litigation should be conducted.
Gleaning the floor
The debate continued with questions from the floor over why trials were so long compared with arbitration hearings (Ed Crosse, partner, Osborne Clarke); the current level of arbitration fees (Ronnie King, partner, Ashurst); whether asymmetrical jurisdiction clauses should be advocated in certain circumstances (Dominic Buckwell, general counsel, GESeaco); and whether law firms act as gatekeepers in determining companies’ access to alternative dispute resolution (ADR) (Duncan Campbell, legal adviser, CBI).
On the latter question, Gary Born, chair of the international arbitration practice at WilmerHale, rejected the notion. “It’s a joint approach,” he said. “My sense is that clients are increasingly interested in the longer-term consequences of what their decisions are and are prepared to seek mediation.”
Ramsey J said: “In my last year of practice I did 19 different types of dispute resolution, so I’d expect no case to go through to the trial hearing without there being some ADR.”
Pick of the bunch
Clifford Chance’s Davis put the panel on the spot when he asked: “If you had to pick one form of dispute resolution - arbitration, litigation or mediation - which would it be?
Born - one of the best-known arbitrators in the market - stunned the audience when he added: “But I’d pick litigation because it’s a more fixed set of rules and a predictable set of principles.”
Barclays’ Peddie also opted for litigation, saying: “Don’t underestimate the appetite of individuals within the organisation or on the other side - often a customer or client - [for] the truth. Truth in terms of facts, which you get from litigation. And in terms of legal principle, where better to go to get your answer than the highest court in the land?”
Navigant’s Saunders also plumped for litigation, while Ramsey J said: “If you only have one shot at dispute resolution, then litigation. There are rights of appeal. If you have an initial case and neutrality is important, a panel of three is likely to be the way. But I’d never wish to have only one form of dispute resolution.”
The dissenting voice came from Freshfields’ Partasides, who said: “If you’re in dispute with a party based in Nigeria, Azerbaijan or Venezuela, no one would go for litigation - how are you going to enforce a judgment? There, arbitration offers you something that litigation doesn’t.” But even Partasides acknowledged the attractions of litigation to resolving disputes, adding: “With arbitration you choose your arbitrators, and your choice may not be as effective as the Lord Chancellor’s choice of judges.”
Davis then opened the question to the audience, asking them which method of resolution they would opt for. A handful of people chose arbitration, while 90 per cent voted for litigation. None voted for mediation.
“It was an interesting result,” Davis told The Lawyer afterwards. “Contrary to popular belief, the debate showed a great deal of confidence in our dispute resolution mechanisms.”
Finally, the tips
To round off the debate, Davis asked each of the panel to provide one key tip to the audience.
Partasides: “Your lawyers have habits - challenge their habits.”
Ramsey J: “Avoid disputes, and if you can’t have a panoply of weapons and choose them sensibly.”
Saunders: Think about the structure of a team of external counsel, your investigators and experts, and use them early.”
Born: “Always plan ahead for your disputes. Every contract should have dispute resolution provisions. For domestic provisions, typically a choice of court clause, with arbitration clauses used in specialised markets. For international agreements, typically an arbitration clause, presumably institutional. Put a dispute resolution clause at the start of an international arbitration clause for domestic contracts.”
Meanwhile, Peddie offered an interesting challenge. “Concentrate on the personal development of your lawyers,” he said. “If you do a lot more work on the personal development of their careers, when they point their guns on my behalf I know they’re the best people.”